A leading UK competition watchdog has ended a formal investigation into the partnership of Microsoft and the makers of ChatGPT, OpenAI.
The reasoning for such scrutiny was previously described as the software giant having material influence over OpenAI, but now it has ended the case by adding that they don’t control its operations.
The sudden U-turn decision has surprised many. As per the CMA, Microsoft is the biggest investor in OpenAI in terms of finances with up to $13 billion being put on the company to see its success. It was said to acquire major influence over the firm in 2019, but didn’t have de facto control over this. Moreover, it didn’t meet the threshold for official inquiries.
The news comes after expressions of disquiet over the addition of the previous boss of Amazon UK as the interim chair for the CMA. As per the company’s leading executive, Sarah Cardell, she also shared how the CMA doesn’t want to roll out a chilling effect on companies’ confidence amid the growing pressure coming from the British government on regulators to roll out growth proposals.
So far, the CMA says that they found no change in control by Microsoft on OpenAI. Since it never happened, the collaboration doesn’t qualify for any kind of review or scrutiny under the UK’s merger control regime.
However, this decision shouldn’t mean that they have a clean sheet in terms of concerns related to competition. After all, both companies are huge players in the tech world and to see them unite can mean big things.
The CMA began investigating the partnership after news broke out of Sam Altman’s firing and then immediate reinstatement. At the time, Microsoft shared how it would hire Altman so that it could rejoin OpenAI again.
Other points worth a mention are how the CMA investigation showed a dramatic drop in OpenAI’s reliance upon Microsoft for things like computer power that is quintessential for healthy AI business operations.
Microsoft shared more on this matter, including how they were open to CMA’s scrutiny because they were only promoting competition and innovation on a healthy level. Last year, we saw the CMA take a similar stance in terms of dropping an investigation against Amazon’s investments in Anthropic and Microsoft’s collaborations with Mistral and Inflection.
OpenAI has a non-profit board of directors but has a profitable subsidiary. This is where Microsoft happens to be the biggest backer with plenty of returns to investors.
Given the growing influence of US tech giants and political dynamics, some speculate that pressure from American firms, possibly tied to Trump-era policies favoring deregulation, may have influenced UK regulators to ease scrutiny, ensuring competitive advantages for Microsoft and OpenAI in the global AI race.
Image: DIW-Aigen
Read next: Google Launches AI Mode on Search Labs for More Advanced Reasoning, Thinking, and Multimodal Capabilities
The reasoning for such scrutiny was previously described as the software giant having material influence over OpenAI, but now it has ended the case by adding that they don’t control its operations.
The sudden U-turn decision has surprised many. As per the CMA, Microsoft is the biggest investor in OpenAI in terms of finances with up to $13 billion being put on the company to see its success. It was said to acquire major influence over the firm in 2019, but didn’t have de facto control over this. Moreover, it didn’t meet the threshold for official inquiries.
The news comes after expressions of disquiet over the addition of the previous boss of Amazon UK as the interim chair for the CMA. As per the company’s leading executive, Sarah Cardell, she also shared how the CMA doesn’t want to roll out a chilling effect on companies’ confidence amid the growing pressure coming from the British government on regulators to roll out growth proposals.
So far, the CMA says that they found no change in control by Microsoft on OpenAI. Since it never happened, the collaboration doesn’t qualify for any kind of review or scrutiny under the UK’s merger control regime.
However, this decision shouldn’t mean that they have a clean sheet in terms of concerns related to competition. After all, both companies are huge players in the tech world and to see them unite can mean big things.
The CMA began investigating the partnership after news broke out of Sam Altman’s firing and then immediate reinstatement. At the time, Microsoft shared how it would hire Altman so that it could rejoin OpenAI again.
Other points worth a mention are how the CMA investigation showed a dramatic drop in OpenAI’s reliance upon Microsoft for things like computer power that is quintessential for healthy AI business operations.
Microsoft shared more on this matter, including how they were open to CMA’s scrutiny because they were only promoting competition and innovation on a healthy level. Last year, we saw the CMA take a similar stance in terms of dropping an investigation against Amazon’s investments in Anthropic and Microsoft’s collaborations with Mistral and Inflection.
OpenAI has a non-profit board of directors but has a profitable subsidiary. This is where Microsoft happens to be the biggest backer with plenty of returns to investors.
Given the growing influence of US tech giants and political dynamics, some speculate that pressure from American firms, possibly tied to Trump-era policies favoring deregulation, may have influenced UK regulators to ease scrutiny, ensuring competitive advantages for Microsoft and OpenAI in the global AI race.
Read next: Google Launches AI Mode on Search Labs for More Advanced Reasoning, Thinking, and Multimodal Capabilities
